Under Trump Tariffs, Small-Batch Italian Olive Oil Producers Look Beyond U.S. Market for Growth

In the rolling hills of southern Tuscany, Romain Piro has nurtured silver-leaf olive trees for two decades, transforming their fruit into premium olive oil. His sister Marie-Charlotte joined him in 2019, and together they began shipping their boutique produce to the US market – a lucrative but undersupplied sector.

American consumers annually consume approximately 400,000 tons of olive oil, with over 95% of it imported. Olio Piro initially thrived in this niche, securing accolades, notable clientele from Michelin-starred restaurants, and steady sales growth. However, the introduction of tariffs by President Trump has forced the company to reassess its strategy and expand into new export markets.

The tariffs, initially threatened at up to 30%, were recently agreed upon at a more manageable rate of 15%. This is still a significant financial burden for European olive oil producers who have already faced challenges due to extreme weather conditions and smaller harvests. For small-scale ventures like Olio Piro, the uncertainty has necessitated a quicker global expansion than initially planned.

As a result, in early 2021, the siblings expanded their operations into Canada, Japan, and Germany. “We were always planning for a global presence,” Marie-Charlotte explains, “but we didn’t anticipate this speed.” The unpredictable trade environment created by the tariffs has compelled Olio Piro to adapt swiftly and seek more reliable trading partners.

Historically, olive oil was considered a niche ingredient in American cuisine. However, its demand has surged, with domestic production accounting for only 5% of consumption. The rest is primarily imported from Spain and Italy. “We are heavily dependent on foreign olive oil,” admits Joseph R. Profaci, executive director of the North American Olive Oil Association.

The Piro siblings’ path to the olive oil business diverged dramatically. Romain followed a spiritual guide to Tuscany, where he began farming alongside his studies and volunteer work at a local cultural center. He eventually ventured into producing olive oil, selling it directly to high-end restaurants in Paris. Marie-Charlotte, meanwhile, built a successful career in Miami real estate before joining her brother’s endeavor.

Olio Piro offers a half-liter bottle of olive oil for $56, a price deemed “superpremium” by industry analysts. Marie-Charlotte acknowledges that this price point is higher than she would prefer but attributes it to the company’s focus on quality and its manual harvesting methods. The tariffs have altered her plans for price reductions.

The tariff impact extends beyond Olio Piro, affecting even global giants like Spain’s Deoleo, owner of brands including Bertolli. The CEO of Deoleo recently stated that the tariffs would ultimately increase prices for American consumers.

However, domestic olive oil production faces challenges due to climate requirements and limited acreage suitable for cultivation. Analysts predict that the tariffs will lead to higher prices for consumers, potentially driving some to switch to cheaper alternatives like sunflower or canola oil.

The North American Olive Oil Association has attempted to appeal to the administration by highlighting olive oil’s health benefits and the lack of domestic production capacity. Despite a lack of immediate results, they continue advocating for exemptions from the tariffs.

As the details of the trade agreement between the US and EU unfold, Olio Piro will assess its export strategy in January 2022, deciding how much olive oil to ship to the US and how much to allocate for new markets like Canada. “When we are ready to board the ship,” Marie-Charlotte says, “that’s when we’ll make our decision – according to the level of tariffs.”